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INTRODUCTION TO CERTIFICATES OF DEPOSIT

Certificates of Deposits:


Certificate of Deposit is a short term financial deposit instrument issued by Central Bank to licensed Banks, at the time when Central Bank considers it appropriate.

Primary objective of Certificates of Deposit (CD) instrument is to assist the money market in the Sultanate at a time when the persistent excess liquidity prevailing in the market requires remedial action/steps for the protection and maintenance of a healthy and stable money market. In addition, CDs may also be used by CBO as a monetary instrument for any other policy consideration. The CDs mop up excess liquidity from the banking sector and thus enable CBO to stabilize the money market liquidity position. The CDs can be used by the holding banks to obtain funds from CBO through Repos/buy back, as also for inter-bank Repo transactions.

Method of Issuance of Certificates of Deposit

i) Certificates of Deposit will be issued by tender on every Monday by Central Bank of Oman. CBO will not issue separate invitation for each issue. Banks wishing to apply for CDs should submit their sealed application to Monetary Operations Domain of the Central Bank between 08:00 to 12:00 hours Oman local time in the tender box kept at CBOs Head Office.

ii) CDs will be allotted on Tuesdays and Allotment Advices shall be sent to the successful banks.

iii) CDs are issued on Wednesdays and the clearing accounts of allotted banks will be debited with the principal amount allotted on the same day.

iv) On the maturity date, the clearing account of the banks will be credited with the principal amount plus interest earned.

 

 

 History of Certificates of Deposits Results